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Google's CEO has been lauding iAd, saying that Apple's foray into mobile advertising demonstrates a competitive market in which Google should be allowed to acquire AdMob.

Google has been trying to buy AdMob since November, having snatched the company from Apple, but is facing resistance from the Federal Trade Commission who sees a potential monopoly. Apple's entry into the market removes that threat, at least according to Google CEO Eric Schmidt as Reuters reports.

Addressing the American Society of News Editors, Schmidt explained that iAd was "evidence of a highly competitive market".

"It just seems obvious to me," said the man who wants to spend $750m buying a company which is, admittedly, perfectly placed to compete with iAd.

Given the dominance of the iPhone in mobile applications, and Apple's complete control of the distribution mechanism, iAd should certainly give AdMob a run for its money. Apple would never prevent AdMob-embedded applications - that would invite regulatory attention - but as a one-stop shop for developers even Google will have a hard time competing with Apple. So long as the iPhone remains the dominant mobile-application platform, anyway.

There's no indication that Apple is interested in extending iAd beyond its own hardware, and while the iPhone gets all the attention the rest of the industry isn't sitting still. Every day sees another application store launched (today's launch: Deutsche Telekom's UK store); other platforms are increasingly relevant, and making money.

It's easy to imagine Google and Apple carving up the mobile-advertising market between them, maintaining the illusion of competition but actually avoiding each other while squashing smaller players and raising insurmountable barriers to entry. ®